Risk-risk versus standard gamble procedures for measuring health state utilities

Title: Risk-risk versus standard gamble procedures for measuring health state utilities
Authors: Dolan, Paul and Jones-Lee, Michael and Loomes, G.
PublisherApplied economics, 27 (11). pp. 1103-1111
ISSN: 0003-6846
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Abstract: Contingent valuation (CV) has been widely used to measure the potential benefits derived from different policy decisions. However, doubt now exists about the validity of the CV method and alternative approaches to benefit valuation have been proposed. The paper reports on the results of a study which was designed to test the viability of two of the most prominent of the alternatives: the risk-risk (RR) and standard gamble (SG) approaches. If individual preferences are consistent with the axioms of von Neumann-Morgenstern expected utility theory (EUT) then the two methods should generate the same interval scales for any given set of health states. However, the results show that SG utilities are substantially higher than RR ones, thus casting doubt on these axioms. The paper discusses alternatives to EUT which might better expalin the discrepancies found. It also considers whether the results might be explained in terms of status-quo bias and/or by the relative difficulty of RR questions. The results presented may have important implications for other areas of applied research in which there exists uncertainty about outcomes.

 

 

 

Time preference, duration and health state valuations

Title: Time preference, duration and health state valuations.
Authors: Dolan, Paul and Gudex, Claire
PublisherHealth economics 4 (4). pp. 289-299
ISDN: 1057-9230

AbstractThere is increasing interest in health status measurement and the relative weights that people attach to different states of health and illness. One important issue which has been raised is the effect that the time spent in a health state may have on the way that state is perceived. Previous studies have suggested that the worse a state is, the more intolerable it becomes as it lasts longer. However, for most of these studies, it is impossible to determine how much of what was observed is attributable to the time spent in the state and how much is attributable to when it was occurring. This paper reports on a pilot study designed to test the feasibility of using the Time Trade-Off (TTO) method to isolate the effect of pure time preference from the effect of duration per se. Interviews were conducted with 39 members of the general population who were asked to rate 5 health states for durations of one month, one year and ten years. In aggregate, rates of time preference were very close to zero which suggests that the implicit assumption of the TTO method that there is no discounting may be a valid one. However, that more respondents had negative (rather than positive) rates, casts some doubt on the axions of discounted utility theory. In addition, implied valuations for states lasting for short periods were often counter-intuitive which questions the feasibility of using the TTO method to measure preferences for temporary health states.

 

 

The effect of past and present illness experience on health state valuations

Title: The effect of past and present illness experience on health state valuations
Authors: Kind, Paul and Dolan, Paul
Publisher: Medical care, 33 (4 (S)). pp. 255-263
ISSN: 0025-7079
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Abstract: The effects of age, sex, income, and other socioeconomic factors on valuations for health states have been reported in the literature. However, little attention has been paid to the influence of illness experience, either current or past, on valuations for of states. This paper addresses that question using six separate data sets covering some 1,900 subjects. Each data set contains information on self-reported current health status and experience of serious illness in self, family, and others. Past experience of illness has not been found to affect valuations, but there is some evidence to suggest that, compared with those who claim to be in full health, those who describe their current health as dysfunctional give higher valuations (i.e., closer to good health) for all health states, and particularly so for the more severe states. The most striking result, however, concerns the relationship between respondents’ valuations of their own health and their subsequent valuations of hypothetical health states. In all studies, it has been observed that a low self-rated health status is associated with significantly lower valuations of less severe states, including full health. The findings of this paper suggest a real dilemma for health services researchers and policy makers. The importance of the choice of valuations used in the evaluation of health care now must be recognized, because different results may be obtained according to the current health status of those respondents from whom valuations are.